Key Findings of the Auditor General of Canada

• During the planning phase, the design phase, and the initial stages of the construction phase of the Centre Block Rehabilitation Program, Public Services and Procurement Canada has thus far effectively managed the scope, schedule, and costs and kept the program on schedule and within costs. One way it achieved this was by using flexible management approaches.
• The department worked with stakeholders and experts to develop the scope of the program and balance sustainability, heritage, accessibility, and inclusivity elements. It also balanced these elements with the requirements of building occupants and the need to improve and modernize the Centre Block building.
• The governance of the rehabilitation program remained fragmented, resulting in delays in obtaining key decisions on some user requirements from the parliamentary partners.^[1]

Summary of the Committee’s Recommendations and Timelines

Table 1—Summary of the Committee’s Recommendations and Timelines

Background

Canada’s Parliament buildings are the focal point of Canadian political life. As such, they convey the symbolic and ceremonial aspects of Parliament and serve as living museums. Understandably, they are a national treasure and a tourist destination. Over time, Parliament Hill has “become a visual symbol of Canada’s parliamentary democracy. In 1987, they were given the federal government’s highest-level heritage designation.”^[2]

In official parlance, the Parliament buildings are found on the Parliament Hill grounds and are part of the Parliamentary Precinct, which includes the 3 city blocks facing Parliament Hill. Some of these include

• the Centre Block (with the adjacent Peace Tower);
• the West Block;
• the East Block;
• the Library of Parliament;
• a visitor welcome centre (underground between the West Block and the Centre Block); and
• the Confederation Building.^[3]

Additionally, the grounds provide the setting for national celebrations, public ceremonies, and lawful demonstrations.^[4]

The primary occupants of the Centre Block are the House of Commons, the Senate of Canada, the Library of Parliament, and the Parliamentary Protective Service. This is in addition to the millions of Canadian and international visitors who come to see the Centre Block and Parliament Hill grounds.^[5]

According to the Office of the Auditor General of Canada (OAG), since the current Centre Block building was completed in 1927 (replacing the original that was destroyed by a fire in 1916), only minor repairs have been made to it. Over the years, assessments of the building conditions by Public Services and Procurement Canada (PSPC) “showed decaying structural integrity, asbestos and other hazardous material on site, and tears and holes in the roof that led to water leaks and moisture damage. The building needed major repairs to bring it up to modern safety, environmental, and accessibility standards and to make it functional for parliamentarians and their staff.”^[6]

In its 2010 audit on rehabilitating the Parliament buildings, the OAG reported that PSPC (then known as Public Works and Government Services Canada) “predicted that the Centre Block could experience ‘total failure’ sometime between 2019 and 2025 if major repairs were not undertaken.”^[7]

Consequently, the Centre Block building, including the Peace Tower, is being rehabilitated to bring it up to modern building standards. Furthermore, the original visitor welcome centre is being expanded to build a new Parliament Welcome Centre. Together, these projects are referred to as the Centre Block Rehabilitation Program.^[8]

The Centre Block Rehabilitation Program is part of the Long Term Vision and Plan [LTVP] for the Parliamentary Precinct. Developed in 2001 and updated in 2006, “it is the government’s multi-year strategy for

• restoring deteriorated heritage buildings in the Parliamentary Precinct
• improving accommodations to support parliamentary operations
• modernizing the buildings to make them accessible, sustainable, digital, and more secure.”^[9]

The Program was approved in 2016 with a target date range for completing construction between 2030 to 2031. The reopening was scheduled for one year later to allow Parliament to undertake testing and prepare the building for operations. A cost estimate range of between $4.5 billion to $5 billion was established in 2021 for construction, as well as for contingencies (i.e., provisions for anticipated challenges, such as poorer building conditions than expected) and a reserve (i.e., provisions for unanticipated challenges, such as the increase in building-material costs due to unexpected events). This project is guided by a project management process that covers three phases from planning to construction (see Table 2).^[10]

Table 2—Key Project Management Phases

Source: Prepared with information from the Office of the Auditor General of Canada, Rehabilitation of Parliament’s Centre Block, Report 3 of the 2023 Reports of the Auditor General of Canada, Definitions, Exhibit. 3.3.

PSPC is a common service organization for the federal government; it is also the custodian of federal real property, including the buildings and grounds in the Parliamentary Precinct. As such, it is responsible for the care, upkeep, operations, and management of these buildings and grounds. For the Centre Block Rehabilitation Program, it is “responsible for the rehabilitation work done to the buildings, including activities such as project planning and delivery, as well as managing the schedule, scope, and costs.”^[11]

In 2017, PSPC entered into four main contracts for the following to support the delivery of the program:

• architectural and engineering services;
• construction management services;
• project management support services; and
• cost, time, and risk management support services.^[12]

In 2023, the OAG released an audit that focused on whether PSPC “effectively managed the cost, schedule, and scope of the Centre Block Rehabilitation Program while balancing the requirements of Parliament, the heritage character of the building, sustainability, and equitable access for parliamentarians and the public. The audit also looked at whether the department, in cooperation with key partners and stakeholders, put in place a governance framework to support timely decisions for the [Program].”^[13]

(The audit period included the planning phase to the initial stages of the construction phase, as explained in Table 2.^[14])

On 24 October 2023, the House of Commons Standing Committee on Public Accounts (the Committee) held a hearing on this audit, with the following in attendance:

• OAG—Andrew Hayes, Deputy Auditor General; Susan Gomez, Principal; and Elsa da Costa, Acting Principal
• PSPC—Arianne Reza, Deputy Minister; Robert Wright, Assistant Deputy Minister of Science and Parliamentary Infrastructure Branch; and Jennifer Garrett, Director General, Centre Block Program^[15]

Several members of the Committee have also taken a tour of the Centre Block rehabilitation project that was provided by PSPC.

The following definition is used in this report:

Gender-based analysis plus (GBA+): An analytical process that provides a rigorous method for the assessment of systemic inequalities and a means to assess how diverse groups of women, men, and gender-diverse people may experience policies, programs, and initiatives. The “plus” acknowledges that gender-based analysis goes beyond biological (sex) and socio-cultural (gender) differences and considers many other identity factors, such as race, ethnicity, religion, age, and mental or physical ability.^[16]

Findings and Recommendations

Consultations on Heritage, Sustainability, and Accessibility Elements

The OAG found that PSPC consulted with stakeholders and experts on how to balance environmental sustainability and accessibility elements in the program’s scope while respecting the heritage nature of the Centre Block building. The department also tried to incorporate accessibility and inclusivity elements.^[17]

And although it completed a GBA+ assessment on its LTVP, it did not do so for the Centre Block or the Parliament Welcome Centre.^[18]

Consequently, the OAG recommended that PSPC “should conduct a gender-based analysis plus assessment for the Centre Block Rehabilitation Program following federal government best practices in order to guide decision making, monitoring, and program review to ensure that the public spaces are inclusive and represent the diversity of all Canada’s peoples.”^[19]

In its Management Action Plan, PSPC stated that it “will develop a GBA+ analysis for the updated [LTVP] that will include specific considerations for major projects, including ongoing work on the Centre Block Rehabilitation Program” by Winter 2023. Moreover, in “the spirit of implementing this recommendation on a go-forward basis, [GBA+] conducted in the future for the [LTVP] will also include a specific focus on upcoming major projects, such as the Block 2 redevelopment, East Block and Confederation Building.”^[20]

At the hearing, in response to a question about how the department is employing GBA+ in this project and addressing the 94 calls to action from the Truth and Reconciliation Commission, Deputy Minister Arianne Reza explained that they are working with “indigenous partners and some of the GBA+ broader community to look at the welcome centre and the visitor centre, which are two separate things, to make sure that those elements are properly integrated.”^[21]

Additionally, Assistant Deputy Minster Rob Wright provided the following:

[The] design team is working with indigenous architects. We're working with indigenous communities, as well as looking at the fellowship program of bringing on indigenous carvers. That is resulting in some interesting concepts that will come to Parliament around having appropriate indigenous elements into the Parliament welcome centre, which I think could prove quite exciting.

We've also worked in supporting Heritage Canada and a survivor steering committee for the selection of the residential school monument that will be located on Parliament Hill as well.

There are a host of activities that we're working on to help ensure that these calls to action are responded to.^[22]

Therefore, the Committee recommends:

Recommendation 1

That, by 30 September 2024, Public Services and Procurement Canada present the House of Commons Standing Committee on Public Accounts with the results of its Gender-Based Analysis Plus assessment for the Centre Block Rehabilitation Program.

Delays in Receiving Key Decisions on Some User Requirements

As the primary occupants of the Centre Block, the parliamentary partners (i.e., the House of Commons, Senate) are accountable for determining their user requirements related to the rehabilitation program. This includes items like the number and size of offices, committee rooms, lobbies, as well as security.^[23]

The OAG found that, although PSPC had “established a governance framework for the implementation of the program, decision making on some user requirements from the parliamentary partners remained fragmented and key decisions were not always endorsed in a timely manner.”^[24]

For example, in 2019, the governance framework for the LTVP established oversight committees that included the Assistant Deputy Minister Oversight Committee and a new Deputy Minister Oversight Committee, whose members included representatives from the department and the parliamentary partners. The OAG found that, to support decision making on the LTVP, including the Centre Block Rehabilitation Program, these committees had a standing item on specific key decisions on user requirements related to the program in their meeting agendas. However, they did not discuss the program’s overall scope, schedule, and costs; hence, the parliamentary partners did not receive complete information about the overall progress and risks to the program through these committee meetings.^[25]

The House of Commons Board of Internal Economy is the governing body of the House of Commons. Similarly, “the Standing Senate Committee on Internal Economy, Budgets and Administration considers all financial or administrative matters related to the internal management of the Senate of Canada.”^[26] One of their roles is to identify and endorse key decisions regarding user requirements proposed for the Centre Block Rehabilitation Program. PSPC provided information on design options related to key decisions to these committees individually and worked “with each parliamentary partner to reach agreement on user requirements. This created a risk to the timely delivery of the program if the House of Commons and the Senate of Canada endorsed conflicting decisions.”^[27]

In 2021, a Senate subcommittee and a House of Commons working group started meeting jointly to discuss the LTVP and the renovations to the Centre Block. They met jointly three times during the audit period to discuss areas of common interest and provide recommendations on user requirements to their respective committees. The OAG concluded that meeting jointly allows PSPC to present information to representatives of both houses of Parliament at the same time to facilitate making recommendations on user requirements.^[28] (For further information about the working group’s composition and mandate, please refer to Annex A.)

In March 2022, PSPC presented a proposal for an integrated forum to the LTVP Deputy Minister Oversight Committee. The proposed forum would include the PSPC Minister and both Speakers to discuss matters of common interest, challenges, and risks on the implementation of the LTVP. However, consensus was not achieved among all partners on this proposal. The Committee ultimately agreed that the Speakers and the Minister would meet on an ad hoc basis as required; yet, by the end of the audit period, no meetings had taken place.^[29] The result was that that decision making remained fragmented, “as discussions on key decisions on user requirements continued to be undertaken separately by the House of Commons and the Senate of Canada.”^[30]

Lastly, the OAG found that delays in decision making on user requirements was an ongoing concern for PSPC for the delivery of the program. It communicated concerns on the delays in receiving user requirements from the parliamentary partners to some parliamentary committees. However, it had not publicly stated (in a consistent manner) that delays on key decisions for user requirements were an ongoing, significant risk. The OAG concluded that given the size and complexity of the program, especially as it moves further into the construction phase, potential scope changes will increase the impacts on its cost and schedule.^[31]

Consequently, the OAG recommended that in order to support timely decision making from the parliamentary partners, PSPC “should submit a progress update on the Centre Block Rehabilitation Program to the Speaker of the House of Commons and the Speaker of the Senate of Canada at the same time and at least twice a year. The update should outline:

• key risks and mitigation measures to manage the program;
• significant changes or adjustments, with an assessment of their impacts on the scope, costs, and overall schedule; and
• key decisions required to be made by the parliamentary partners with an expected timeline.”^[32]

In its action plan, the department stated its agreement with the recommendation and committed to the following milestones by the Fall of 2023 (and semi-annually thereafter):

PSPC to develop a semi-annual report to the Speaker of the Senate and Speaker of the House of Commons, outlining:

• key risks and mitigation measures to manage the program,
• significant changes or adjustments with an assessment of the impacts on the scope, costs, and overall schedule, and
• key decisions required to be made by parliamentary partners with an expected timeline.^[33]

At the hearing, in response to a question about this matter, Arianne Reza provided the following:

We have now, post-audit, added a new report that we already table semi-annually. Minister [Jean-Yves] Duclos has tabled it with the House of Commons Speaker, as well as the Senate Speaker. It outlines not only the progress made to date but also the key decision points that need to be made going forward, in the hope that this will be an additional catalyst to help us streamline the existing governance process.^[34]

As the department has already integrated the OAG’s recommendation into its ongoing business practices, the Committee makes no recommendation on this matter.

Flexible Schedule Management Approach

The OAG found that PSPC implemented processes to effectively manage the schedule including a flexible management approach to help the program remain on schedule.^[35]

The department worked collaboratively to effectively manage the schedule and the risks of delays with multiple forums to discuss the planning and scheduling of activities. Its integrated office included representatives from the project contractors who planned, coordinated, and adjusted activities to keep the project on schedule. For example, in April 2020, PSPC identified the COVID‑19 pandemic as a risk to the schedule, and subsequently “developed strategies, such as taking certain health and safety measures to allow workers to remain on site, so the work could stay on schedule.”^[36]

The OAG also found that PSPC had implemented processes in place to effectively manage the costs of the program thus far and mitigate the risks of costs increasing; e.g., it:

• used a cost estimate process and a change management process;
• used monthly expenditure data from its financial system to monitor and compare these costs against monthly planned costs;
• used monthly risk registers to identify potential cost increases; and
• reported internally using quarterly dashboards and presentations to departmental committees.^[37]

In 2016 and 2021, PSPC received funding for planning, design, and construction activities for the rehabilitation of the Centre Block and the Parliament Welcome Centre. In planning for the overall costs of the program, it included contingency amounts (for anticipated challenges, such as potential scope changes) and a reserve (for unanticipated challenges, such as changes to the cost of materials and labour).^[38]

The OAG found that following the planning and some design work from 2016 to 2021, PSPC “used an independent firm to validate the overall costing methodology and establish a cost estimate for the construction of the Centre Block and the new Parliament Welcome Centre. In June 2021, the department published this cost estimate of $4.5 billion to $5 billion for the program. This amount was for construction activities as well as contingencies and a reserve.”^[39]

Additionally, the OAG examined PSPC’s actual costs since the program was approved, and found that up to 31 July 2022, it had spent a total of $880.7 million on rehabilitating the Centre Block and expanding the Parliament Welcome Centre, as follows:

• $450.0 million on planning and design activities (e.g., assessments and site preparations); and
• $430.7 million on construction and excavation activities, as well as the removal of hazardous material.^[40]

Since September 2021, PSPC published quarterly reports on its website that provided additional information on the construction of the Centre Block Rehabilitation Program. It also published information about the progress of the rehabilitation program in its LTVP annual reports, which included cost reporting.^[41]

However, the OAG found that these reports were not published in a timely manner. For example, the 2020–21 and 2021–22 LTVP annual reports had not been published by the end of the audit period.^[42]

Consequently, the OAG recommended that in order to provide timely information to all Canadians, PSPC should “publish its [LTVP] annual reports within the calendar year.”^[43]

In its action plan, the department stated that starting in 2023, per the recommendation, it will ensure that the LTVP annual reports are published within the same calendar year as their fiscal-year reporting period.^[44]

At the hearing, Arianne Reza confirmed that in respect of “the recommendation regarding timely and clear reporting, the department will publish the 2022–23 Long Term Vision and Plan annual report before the end of this calendar year.”^[45]

Therefore, the Committee recommends:

Recommendation 2

That, by 30 September 2024, Public Services and Procurement Canada provide the House of Commons Standing Committee on Public Accounts with a letter confirming that it is publishing its Long Term Vision and Plan annual reports within the calendar year.

Conclusion

The Committee concludes that, thus far, Public Services and Procurement Canada effectively managed the scope of the Centre Block Rehabilitation Program, and implemented processes to effectively manage its cost and schedule. Moreover, it did so while balancing the requirements of the parliamentary partners, the building’s heritage, sustainability, along with equitable access for parliamentarians and the public.

Additionally, the department, in cooperation with key partners and stakeholders, implemented a governance framework for the Centre Block Rehabilitation Program. However, although it made efforts to improve processes, decision making remained fragmented, and key decisions from parliamentary partners on certain user requirements were not timely.

In this report, the Committee makes two recommendations to help the department continue the progress of the Centre Block Rehabilitation Program.